Is Barnes & Noble Getting Out of the Nook Device Business?
Is Barnes & Noble getting out of Nook device business?
Very poor performance in its all important holiday quarter and the company announcements that followed suggest this might be the case. In that quarter, it failed to sell more Nook tablets than the previous year while nearly all its competitors made huge advances and had to write off $80 million in unsold Nook hardware.
Then the company began a consistent and concerted campaign to steeply discount both its hardware and software. It started with a splashy Nook e-reader giveaway with every purchase of a Nook HD+ tablet. More recently, Barnes & Noble launched a summer discount blitz on both devices and content and extended its device Fathers’ Day sale well past the holiday itself. Here is a fairly complete list of Nook discount announcements from the past three months.
Aside from deep discounting, which digital publishing blogger Nate Hoeffelder points out is what H-P did before killing off its TouchPad tablet brand, the company has struck a series of deals to make sure its Nook app can be found pre-loaded on other manufacturers’ hardware. Today, the company announced that a Nook kids-focused app will come pre-loaded on the Fuhu nabi children’s tablet and that the Nook app will come pre-loaded on the E FUN Nextbook tablets.
I’ve also heard from a fairly credible source that in the fall, when Barnes & Noble typically announces a suite of new devices, it will only be announcing new e-reader devices and not new tablets. If this were to prove true, one important step for Nook to take to ensure that it isn’t shut out of the world of tablets would be to make sure that its Nook app is available on all platforms, or, better yet, that it comes pre-loaded.
A Barnes & Noble representative reached for comment offered “no comment” in light of the company’s full-year earnings report coming out tomorrow.
Kobo, a Barnes & Noble competitor that is much smaller in the U.S. but has a large international presence, has publicly stated that it’s “doubling down” on e-readers, implying that it’s no longer focusing on its tablet business, likely in the face of strong competition from Apple, Samsung*, Amazon and others. The company also recently released a high-end e-reader to compete with the Kindle Paperwhite. The strategy has seemed to pay off with Kobo e-reader sales skyrocketing so far this year.
As for now, we can only speculate as to what Barnes & Noble’s plans are for the Nook devices though it doesn’t look very good from where I’m sitting. The company will release its full-year 2013 results tomorrow. I’ll keep you posted.
* Samsung has recently showed signs that it will be entering into the ebook retail business in earnest on the strength of its Galaxy tablet and smartphone sales, which, in the case of the latter at least, rival Apple and its powerful fleet of devices.